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“Section 37(1)”

Section References (mined)Section 37Section 37(1)4,308 judgments

The decision most relied on for Section 37(1) is CIT v. Reliance Utilities & Power Ltd. (313 ITR 340), cited in 2,118 judgments on BharatTax.

Leading authorities on Section 37(1)

CIT v. Reliance Utilities & Power Ltd.
313 ITR 340 · 2009 · High Court
2,118
citing judgments

Where an assessee claims that investments were made out of own funds, interest disallowance under Section 14A read with Rule 8D may not apply if the assessee demonstrates the availability of sufficient interest-free funds to cover such investments.

Goetze (India) Ltd. v. CIT
284 ITR 323 · 2006 · Supreme Court
1,842
citing judgments

An assessee cannot raise a new claim or a claim not made in the original or revised return of income for the first time directly before the Assessing Officer during assessment proceedings.

Maxopp Investment Ltd. v. CIT
402 ITR 640 · 2018 · Supreme Court
1,596
citing judgments

Disallowance under Section 14A is not automatic and requires the Assessing Officer to record satisfaction before applying Rule 8D. Only investments yielding exempt income are considered for disallowance, irrespective of their strategic nature.

Cheminvest Ltd. v. CIT
378 ITR 33 · 2015 · High Court
1,569
citing judgments

A disallowance under Section 14A of the Income-tax Act, 1961, for expenditure incurred in relation to exempt income cannot be made if the assessee has not earned any exempt income during the relevant previous year.

Checkmate Services Pvt. Ltd. v. CIT
143 Taxmann.com 178 · 2022 · Supreme Court
1,392
citing judgments

Employee contributions to provident fund and ESI deposited by an employer beyond the due dates prescribed under the respective special Acts are not allowable as a deduction under section 36(1)(va) of the Income-tax Act, 1961. Such disallowance can be made during processing under section 143(1).

CIT v. HDFC Bank Ltd.
366 ITR 505 · 2014 · High Court
1,261
citing judgments

When an assessee possesses interest-free funds sufficient to cover investments yielding tax-free income, it is presumed that such investments were made from these interest-free funds, precluding disallowance of interest expenditure under Section 14A.

Godrej & Boyce Mfg. Co. Ltd. v. DCIT
328 ITR 81 · 2010 · High Court
1,183
citing judgments

Rule 8D, for computing disallowance under Section 14A for expenses related to exempt income, applies from Assessment Year 2008-09 onwards; for prior years, a reasonable disallowance must be made. The disallowance under Section 14A cannot exceed the actual exempt income earned.

CIT v. Woodward Governor India Pvt. Ltd.
312 ITR 254 · 2009 · Supreme Court
968
citing judgments

Foreign exchange fluctuations, whether gains or losses, are inextricably linked to the underlying business transaction and must be accounted for under the mercantile system. The Supreme Court also affirmed the standard accounting principle of valuing stock at cost or net realisable value, whichever is lower.

Judgments citing Section 37(1)

Assistant Commissioner of Income Tax, Anand Circle, Anand vs. Anupam Industries Limited, Anand

The appeal of the Department is dismissed

ITA 1015/AHD/2023[2017-18]Status: DisposedITAT Ahmedabad17 Nov 2025AY 2017-18

Bench: Dr. Brr Kumar & Shri Siddhartha Nautiyal

For Appellant: Respondent by: Shri Alpesh Parmar, CIT-DRFor Respondent: Shri Alpesh Parmar, CIT-DR
Section 143(3)

penalty of Rs. 38,91,205/-, treating the entire amount as penal in nature following Explanation 1 to section 37(1) and various judicial precedents. The Assessing Officer then disallowed Rs. 2,19,479/- under section 37(1) of the Act, treating certain vehicle, telephone and electricity expenses of directors ... cash payments exceeding permissible limits. The AO also disallowed interest of Rs. 46,47,106/- under section 37(1), holding that interest payable under the MSMED Act is expressly barred as a deduction under section 23 of that Act. Further, the Assessing Officer disallowed

Sempertrans India Private Limited, Roha vs. Income-Tax Officer, Panvel

In the result, appeal filed by the assessee is partly

ITA 1778/PUN/2024[AY 2020-21]Status: DisposedITAT Pune14 Nov 2025

Bench: Dr.Manish Borad & Ms. Astha Chandraआयकर अपील सं. / Ita No.1778/Pun/2024

For Appellant: Shri Ajit Jain andFor Respondent: Shri Prakash L. Pathade
Section 144Section 144CSection 144C(8)Section 153Section 37(1)Section 92CSection 92D

directions in violation to provisions of section 144C(8), read with the explanation thereto, by directing the AO to make additional disallowance under section 37(1). Accordingly, the directions of the Hon'ble DRP are bad in law and ought to be quashed. Consequently, the final assessment order dated ... business nexus and no case of Intra Group Services rendition. The claim of deduction does not pass the factual/legal tests of sub- section 37(1). This is to be taken as a supporting and alternate ground to Ld. TPO's action of setting the ALP of the claims services

Nirman Sonestaa Developers, Bengaluru vs. Deputy Commissioner of Income Tax, Circle- 4(1)(1), Bangalore

In the result, the appeal by the assessee is dismissed

ITA 1536/BANG/2025[2018-19]Status: DisposedITAT Bangalore14 Nov 2025AY 2018-19

Bench: Shri Prashant Maharishi & Shri Sandeep Singh Karhailassessment Year: 2018-19

For Appellant: NoneFor Respondent: Sri Subramanian, D.R
Section 142(1)Section 143(2)Section 250Section 37Section 37(1)

erred in law in sustaining the disallowance of Rs.76,05,613/- paid as compounding fee to BBMP, by invoking explanation 1 to section 37(1), overlooking that the payment was for permitted regularization of minor deviations, and not for any offense or act prohibited by law. 3. The compounding ... Hero Cycles Ltd. v. CIT [17 DTR 281 (P&H HC)] – Routine business lapses not involving moral turpitude not hit by Explanation to Section 37(1). Kaira Can Company Ltd. [32 DTR 485] – Regularization charges not considered penal and hence allowable. DCIT v. Bharat C. Gandhi

ACIT, Circle-1(1), New Delhi, C.R. Building vs. Aircom International India Pvt Ltd, Delhi

The appeal of the Revenue is dismissed

ITA 3096/DEL/2023[2014-15]Status: DisposedITAT Delhi14 Nov 2025AY 2014-15

Bench: Shri S. Rifaur Rahman & Shri Anubhav Sharmaassessment Year : 2014-15 Dcit, Vs. M/S Aircom International India Pvt. Ltd., Circle-1(1), M-12, Balrama House, New Delhi. Karampura Complex, Opp. Milan Cinema, Karam Pura West Delhi Delhi – 110 015. Pan: Aadca0915A (Appellant) (Respondent) Assessee By : Shri Salil Kapoor, Advocate; Ms Ananya Kapoor, Advocate; & Shri Shivam Yadav, Advocate. Revenue By : Shri Ajay Kumar Arora, Sr. Dr Date Of Hearing : 06.11.2025 Date Of Pronouncement : 14.11.2025 Order

For Appellant: Shri Salil Kapoor, AdvocateFor Respondent: Shri Ajay Kumar Arora, Sr. DR
Section 143(3)Section 250(4)Section 36(1)(vii)Section 36(2)Section 37(1)

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCHES : A : NEW DELHI BEFORE SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER AND SHRI

Texo the Builders, Udupi vs. ACIT, Central Circle-2, Mangalore

In the result, we dismiss grounds raised by the assessee

ITA 1200/BANG/2025[2014-15]Status: DisposedITAT Bangalore13 Nov 2025AY 2014-15

Bench: Shri.Laxmi Prasad Sahu & Shri.Soundararajan K

For Appellant: Shri. Sandeep Chalapathy, CAFor Respondent: Shri. Subramanian S,JCIT(DR)(ITAT), Bangalore
Section 133ASection 147Section 148Section 154Section 40A(3)Section 68

Order of the lower authorities. 14. We found that AO has not doubted on the purchase and he has allowed expenditure claimed under section 37(1) of the Act. But there are other ITA Nos.1199, 1200/Bang/2025 Page 27 of 28 provisions to compute the income under the head profit from ... verified and allowed Rs.3,23,600/- and Rs.29,27,555/- and was added. There is no doubt that the AO has allowed under section 37(1) of the Act but he has made addition under section 40A(3) of the Act because assessee did not satisfy the conditions laid down

Texo the Builders, Udupi vs. ACIT, Central Circle-2, Mangalore

ITA 1199/BANG/2025[2013-14]Status: DisposedITAT Bangalore13 Nov 2025AY 2013-14

Bench: Shri.Laxmi Prasad Sahu & Shri.Soundararajan K

For Appellant: Shri. Sandeep Chalapathy, CAFor Respondent: Shri. Subramanian S,JCIT(DR)(ITAT), Bangalore
Section 133ASection 147Section 148Section 154Section 40A(3)Section 68

IN THE INCOME TAX APPELLATE TRIBUNAL "B" BENCH : BANGALORE BEFORE SHRI.LAXMI PRASAD SAHU, ACCOUNTANT MEMBER AND SHRI.SOUNDARARAJAN K, JUDICIAL MEMBER

Wheatons Design Private Limited, Jaipur vs. ACIT / DCIT, Circle -6, Jaipur

In the result, appeal of the assessee is allowed

ITA 781/JPR/2025[2014-15]Status: DisposedITAT Jaipur12 Nov 2025AY 2014-15

Bench: The Due Date Of Hearing.”

For Appellant: Shri P.C. Parwal, C.AFor Respondent: Mrs. Anita rinesh, JCIT-DR a
Section 143(3)Section 144BSection 147Section 148Section 250Section 37(1)

NFAC has erred on facts and in law in disallowing the claim of provision for future expenses of Rs. 34,60,713/- under section 37(1) of the IT Act by treating the same as contingent liability. 2 Wheatons Design Pvt. Ltd. Jaipur. 2. That the order so passed ... view that the ‘Provision for future expense’ being contingent in nature, the same was not allowable as per provisions of section 37(1) of the IT Act, 1961. The assessee company had made wrong claim of business expenditure of Rs. 34,60,713/- on account of ‘Provision for future expense

Ahluwalia Erectors & Fabricators Private Limited, Kota vs. DCIT/ACIT Cir-2, Kota

In the result the appeal of

ITA 199/JPR/2025[2022-23]Status: DisposedITAT Jaipur12 Nov 2025AY 2022-23
For Appellant: Shri Mahendra Gargieya, AdvFor Respondent: Mrs. Anita Rinesh, JCIT
Section 143(1)Section 234ASection 250Section 438Section 43B

आयकरअपीलीय अधिकरण, जयपुरन्यायपीठ, जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, "A" JAIPUR डा० एस. सीतालक्ष्मी न्यायिक सदस्य एवं

Ahluwalia Erectors & Fabricators Private Limited, Kota vs. DCIT/ACIT Cir-2, Kota

In the result the appeal of

ITA 198/JPR/2025[2021-22]Status: DisposedITAT Jaipur12 Nov 2025AY 2021-22
For Appellant: Shri Mahendra Gargieya, AdvFor Respondent: Mrs. Anita Rinesh, JCIT
Section 143(1)Section 234ASection 250Section 43B

आयकरअपीलीय अधिकरण, जयपुरन्यायपीठ, जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES,”A” JAIPUR डा० एस. सीतालक्ष्मी न्यायिक सदस्य एवं

Ahluwalia Erectors & Fabricators Private Limited, Kota vs. DCIT/ACIT Cir-2, Kota

In the result the appeal of

ITA 197/JPR/2025[2019-20]Status: DisposedITAT Jaipur12 Nov 2025AY 2019-20
For Appellant: Shri Mahendra Gargieya, AdvFor Respondent: Mrs. Anita Rinesh, JCIT
Section 143(1)Section 234ASection 250Section 438Section 43B

आयकरअपीलीय अधिकरण, जयपुरन्यायपीठ, जयपुर IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHES, “A” JAIPUR डा० एस. सीतालक्ष्मी न्यायिक सदस्य एवं

Assistant Commissioner of Income Tax, CC-30, New Delhi vs. Jps Buildtech Private Limited, New Delhi

In the result, appeal of assessee in ITA Nos

ITA 2947/DEL/2025[2020-21]Status: DisposedITAT Delhi12 Nov 2025AY 2020-21

Bench: Shri Satbeer Singh Godara & Shri Naveen Chandra

For Appellant: Shri Rajat Garg, CAFor Respondent: Shri Mahesh Kumar, CIT-DR
Section 132Section 153CSection 37Section 37(1)

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘G’ BENCH, NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER, AND SHRI

Assistant Commissioner of Income Tax, CC-30, New Delhi vs. Jps Buildtech Private Limited, New Delhi

In the result, appeal of assessee in ITA Nos

ITA 2946/DEL/2025[2019-20]Status: DisposedITAT Delhi12 Nov 2025AY 2019-20

Bench: Shri Satbeer Singh Godara & Shri Naveen Chandra

For Appellant: Shri Rajat Garg, CAFor Respondent: Shri Mahesh Kumar, CIT-DR
Section 132Section 153CSection 37Section 37(1)

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘G’ BENCH, NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER, AND SHRI

Jps Buildtech Private Limited, New Delhi vs. Central Circle-30, New Delhi

In the result, appeal of assessee in ITA Nos

ITA 1930/DEL/2025[2020-21]Status: DisposedITAT Delhi12 Nov 2025AY 2020-21

Bench: Shri Satbeer Singh Godara & Shri Naveen Chandra

For Appellant: Shri Rajat Garg, CAFor Respondent: Shri Mahesh Kumar, CIT-DR
Section 132Section 153CSection 37Section 37(1)

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘G’ BENCH, NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER, AND SHRI

Jps Buildtech Private Limited, New Delhi vs. Central Circle-30, New Delhi

In the result, appeal of assessee in ITA Nos

ITA 1929/DEL/2025[2019-20]Status: DisposedITAT Delhi12 Nov 2025AY 2019-20

Bench: Shri Satbeer Singh Godara & Shri Naveen Chandra

For Appellant: Shri Rajat Garg, CAFor Respondent: Shri Mahesh Kumar, CIT-DR
Section 132Section 153CSection 37Section 37(1)

IN THE INCOME TAX APPELLATE TRIBUNAL, DELHI ‘G’ BENCH, NEW DELHI BEFORE SHRI SATBEER SINGH GODARA, JUDICIAL MEMBER, AND SHRI

Robust Resorts & Hospitality LLP, Delhi vs. DCIT, Central Circle-14, New Delhi

ITA 4312/DEL/2024[2016-17]Status: DisposedITAT Delhi12 Nov 2025AY 2016-17

Bench: Shri S. Rifaur Rahman & Shri Anubhav Sharmaassessment Year : 2016-17 Robust Resorts & Hospitality Llp, Vs. Dcit, J-290, Second Floor, Saket, Central Circle-14, New Delhi – 110 017. New Delhi. Pan: Aarfr7213D

For Appellant: Shri Yudhisthir Mehtani, CAFor Respondent: Shri Ajay Kumar Arora, Sr.DR
Section 147Section 148Section 56(2)(x)Section 69C

Where purchases 4 and source of expense are not doubted and only doubt was regarding genuineness of expense, disallowance may be made under section 37(1) of the Act, by Assessing Officer and section 69C of the Act may not become applicable. Thus where the ld. AO has show caused

Deputy Commissioner of Income Tax, Circle-1(1), Kolkata vs. Bandhan Financial Services Limited, Kolkata

In the result, the appeal of the revenue is dismissed

ITA 1139/KOL/2025[2014-15]Status: DisposedITAT Kolkata11 Nov 2025AY 2014-15

Bench: Shri Rajesh Kumar & Shri Pradip Kumar Choubeyassessment Year: 2014-15 Dcit, Circle-1(1), Kolkata..……………… ……………...……….……….……Appellant Vs. Bandhan Financial Services Ltd....………………………….......……...…..…..Respondent Dn 32 Salt Lake, Salt Lake City, Sech Bhawan, S.O Salt Lake, Kol-700091. [Pan: Aabcg0611R] Appearances By: Shri Manas Mondal, Addl. Cit-Dr, Appeared On Behalf Of The Appellant. Shri Biswanath Paul, Fca, Appeared On Behalf Of The Respondent. Date Of Concluding The Hearing : October 15, 2025 Date Of Pronouncing The Order : November 11, 2025 Order Per Pradip Kumar Choubey: This Appeal Filed By The Revenue Is Directed Against The Order Dated 11.06.2024 Of The Commissioner Of Income Tax (Appeals)-27, Kolkata [‘Cit(A)’] Passed Under Section 250 Of The Income-Tax Act, 1961 (Hereinafter Referred To As “The Act”) For The Assessment Year 2014–15. 2. The Appeal Has Been Filed By The Revenue With A Delay Of 56 Days. The Revenue Has Filed A Petition For Condonation Of The Delay. After Considering The Reasons Cited In The Petition For Condonation Of Delay, We Find That The Reasons Are Valid & Consequently, The Delay In Filing The Appeal Is Hereby Condoned & We Proceed To Dispose Of The Appeal On Merits.

Section 139Section 143(2)Section 143(3)Section 250Section 37(1)Section 40A(3)

expediate for the appellant to incur such expenses, and as a result, such an amount ought to have been allowed as deduction under Section 37(1) of the Act. 5.2.13, Another point which is apt to mention at this stage is that in the earlier years, the Assessing Officer

Monotech Systems Ltd., Chennai vs. DCIT, Corp. Circle-4(1), Chennai

In the result, the appeal of the assessee is allowed

ITA 1021/CHNY/2025[2017]Status: DisposedITAT Chennai11 Nov 2025

Bench: Shri Manu Kumar Giri & Shri S. R. Raghunatha

For Appellant: Shri. J. Prabhakar, F.C.AFor Respondent: Ms. R. Anitha, Addl. C.I.T
Section 147Section 234BSection 36Section 37(1)Section 45

आयकर अपील"य अ"धकरण, ‘सी’ "यायपीठ, चे"नई IN THE INCOME TAX APPELLATE TRIBUNAL ‘C’ BENCH, CHENNAI "ी मनु कुमार

Wockhardt Limited, Aurangabad vs. The Assistant Commissioner of Income Tax Central Circle 2(1), Pune

In the result, the appeal of the assessee is partly allowed

ITA 837/PUN/2025[2016-17]Status: DisposedITAT Pune10 Nov 2025AY 2016-17

Bench: Shri R.K. Panda & Ms. Astha Chandra

For Appellant: Shri Manthan ShahFor Respondent: Shri Amit Bobde
Section 127Section 132Section 132(4)Section 143(2)Section 153C

thus, expenditure incurred in distribution of such freebies would not be allowed as a deduction in terms of Explanation 1 to section 37(1) of the Act. The Hon'ble Supreme Court has further held- ............................ ............................ AYs 2016-17, 2017-18 & 2018-19 36. In the present case too, the incentives ... above findings and discussion grants provided by the assessee to IFMER considered as freebies to the medical professionals shall be inadmissible under section 37(1) of the Income Tax Act being an expense prohibited by law and which are against public policy as per the MCI Regulations in view

Wockhardt Limited, Aurangabad vs. The Assistant Commissioner of Income Tax Central Circle 2(1), Pune

In the result, the appeal of the assessee is partly allowed

ITA 836/PUN/2025[2018-19]Status: DisposedITAT Pune10 Nov 2025AY 2018-19

Bench: Shri R.K. Panda & Ms. Astha Chandra

For Appellant: Shri Manthan ShahFor Respondent: Shri Amit Bobde
Section 127Section 132Section 132(4)Section 143(2)Section 153C

thus, expenditure incurred in distribution of such freebies would not be allowed as a deduction in terms of Explanation 1 to section 37(1) of the Act. The Hon'ble Supreme Court has further held- ............................ ............................ AYs 2016-17, 2017-18 & 2018-19 36. In the present case too, the incentives ... above findings and discussion grants provided by the assessee to IFMER considered as freebies to the medical professionals shall be inadmissible under section 37(1) of the Income Tax Act being an expense prohibited by law and which are against public policy as per the MCI Regulations in view

Wockhardt Limited, Aurangabad vs. The Assistant Commissioner of Income Tax Central Circle-2(1), Pune

In the result, the appeal of the assessee is partly allowed

ITA 835/PUN/2025[2017-18]Status: DisposedITAT Pune10 Nov 2025AY 2017-18

Bench: Shri R.K. Panda & Ms. Astha Chandraआयकर अपील सं. / Ita Nos.837, 835 & 836/Pun/2025 निर्धारण वर्ष / Assessment Years : 2016-17, 2017-18 & 2018-19 Wockhardt Limited, D-4, Midc, Chikalthana, Aurangabad-431006 Vs. Assistant Commissioner Of Income Tax, Central Circle-2(1), Pune Pan : Aaacw2472M अपीलार्थी / Appellant प्रत्यर्थी / Respondent Assessee By : Department By : Date Of Hearing : Date Of Pronouncement : Shri Manthan Shah Shri Amit Bobde 13-08-2025 10-11-2025 आदेश / Order Per Astha Chandra, Jm : The Above Three Captioned Appeals Filed By The Assessee Are Directed Against The Separate Order(S) All Dated 27.01.2025 Of The Ld. Commissioner Of Income Tax (Appeals)-12, Pune ["Cit(A)"] Pertaining To Assessment Years ("Ays") 2016-17, 2017-18 & 2018-19. Since, The Issue(S) Involved Are Identical, These Were Heard Together & Are Being Disposed Of By This Common Order.

For Appellant: Department byFor Respondent: Date of hearing
Section 127Section 132Section 132(4)Section 143(2)Section 153C

thus, expenditure incurred in distribution of such freebies would not be allowed as a deduction in terms of Explanation 1 to section 37(1) of the Act. The Hon'ble Supreme Court has further held- 4 ITA Nos.837, 835 & 836/PUN/2025 ... above findings and discussion grants provided by the assessee to IFMER considered as freebies to the medical professionals shall be inadmissible under section 37(1) of the Income Tax Act being an expense prohibited by law and which are against public policy as per the MCI Regulations in view